An Arizona-based nonprofit will get a $30 million award from the federal Treasury Department to boost investment in low-income areas.
The lending arm of Chicanos Por La Causa, Prestamos CDFI, secured the award.
Here’s how it works: a for-profit company buys the tax credit from CPLC. That money can then be lent or invested in a new business venture in a low-income community.
David Adame, president and CEO of Chicanos Por La Causa, said even though corporate taxes went down with the recent federal law, he believes companies will still be interested in purchasing the credits.
“There’s still a benefit of doing this,” he said, pointing out that the credit would be taken off the top of a company’s tax bill. Investing in distressed communities will also help companies be “good corporate citizens.”
But it is possible, he said, that they would see lower demand for the credits, resulting in CPLC having to take in a cash value lower than the full $30 million.
Adame couldn’t speak about specific projects in the pipeline. In order to apply for the award, the organization had to have a list of business ventures it could potentially invest in.
CPLC has received similar awards twice before.
